The Social Security sacrifice

The debate about changes to Social Security ignores its most important benefit: a longer and healthier life span for America’s seniors.

It seems devilishly ironic that the rationale for hiking the eligibility age, which effectively cuts benefits, is that we are living longer — and that our increased longevity is due, in part, to the benefits of Social Security.

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The drumbeat for drastic change is now heard in Washington, where attention is focused on the program’s long-range financial problems. Many economists and policymakers are pushing for dramatic fixes to address long-term federal budget deficits.

This approach is seriously misguided, however. True, modest changes are needed to keep Social Security fiscally sound over the next 75 years. But the projected shortfall is less than one percent of gross domestic product. Drastic cuts are just not required to close that gap.

Social Security has been and remains the most effective income-support program ever introduced in the United States. It alleviates the burden of poverty for millions of elderly Americans.

President Barack Obama’s National Commission on Fiscal Responsibility and Reform has recommended reducing Social Security benefits and raising payroll taxes. Legislation introduced last year by Rep. Paul Ryan (R-Wis.), his “Roadmap for America,” would lower benefits, and raise the age at which those benefits are paid.

Before any steps are taken to alter Social Security, however, policymakers should take a careful look at the program’s unsurpassed record of reducing poverty and providing a safety net for older Americans. They should consider what these cuts might do to the public’s health.

Most recipients already rely on Social Security for a significant portion of their income. As Americans lose private, defined-benefit retirement plans in record numbers, this reliance is growing.

Nearly two-thirds of beneficiaries aged 65 or older receive 50 percent or more of their total income from monthly Social Security checks. For one-third of elderly beneficiaries, Social Security provides 90 percent or more of their income.

Most compelling is the effect on poverty. Social Security allows nearly 44 percent of the elderly to escape living below the poverty line. All other government programs combined have less impact.

Social Security has also improved older Americans’ health and longevity. After Social Security was implemented in 1940, death rates among persons 65 and older fell more than those in younger age groups, according to our recent study. That pattern continued in the mid-1960s and early 1970s — after Social Security benefits were markedly improved through legislation and the indexing of benefits to inflation.

Raising the age to receive benefits or reducing those benefits is likely to have the opposite effect — potentially pushing millions of older citizens into poverty. It could also reverse the progress this nation has made in improving the average lifespan of all Americans.

If we fail to consider Social Security’s effect on reducing poverty and extending life, we will jeopardize the most important safety net ever created for America’s elderly. Before radically altering it for generations to come, policymakers should look closely at how the program benefits the entire society.

Peter S. Arno is a professor of health policy and management at New York Medical College’s School of Health Sciences and Practice. Deborah Viola is an associate professor of health policy and management at the New York Medical College School of Health Sciences & Practice